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The main task of an industrial engineer is specifying the “black-box” into an effective and
efficient production/management design.
What is Management?
Management is the process of coordinating work activities so that they are completed efficiently and effectively with and through other people.
What as An Organization?
An Organization defined as
a deliberate arrangement of people to accomplish some specific purpose
Common Characteristics of Organizations
Have a distinct purpose (goal)
Composed of people
Have a deliberate structure
Type of Organization Structure : FUNCTIONAL Each portion of the organization is grouped according to its purpose.
Works very well for small businesses in which each department can rely on the talent and knowledge of its workers and support itself.
The coordination and communication between departments can be restricted by the organizational boundaries of having the various departments working separately.
Used in larger companies that operate in a wide geographic area or that have separate smaller organizations within the umbrella group to cover different types of products or market areas.
Needs can be met more rapidly and more specifically
Communication is inhibited because employees in different divisions are not working together.
It is costly because of its size and scope.
Type of Organization Structure : DIVISIONAL
Type of Organization Structure : MATRIX
A hybrid of divisional and functional structure.
Typically used in large multinational companies
Allows for the benefits of functional and divisional structures to exist in one organization.
This can create power struggles because most areas of the company will have a dual management
Who Are Managers? Someone who works with and through other people by
coordinating their work activities in order to accomplish organizational goals.
Level of Managers
Manager’s Functions
Manager’s Roles
Manager’s Skills
Level of Managers
Tactical Planning & ControlComprehensive Report
Operational Planning & ControlDetail report
Strategic & Fundamental Planning & ControlOverall Report
TOPMANAGEMENT
(CEO)
MIDDLEMANAGEMENT
(Manager)
FIRST LINE / BOTTOMMANAGEMENT
(Supervisor)
Worker, Operator, Clerical & Administration Staff, Professional StaffNonmanagerial Employees
Manager’s Functions Planning : “doubling our market share in five years...”
Organizing : “who do what to increase our market share”
Leading/Actuating : “Good job!...when you complete, you’ll be promoted”
Controlling : “...this part still does not reach the standard”
Manager’s Roles
Interpersonal : Roles that involve people
(subordinates and persons outside the organisation) and other duties that are ceremonial and symbolic-figurehead, leader, liaison
Informational : Roles that involve receiving,
collecting and disseminating
information-monitor, disseminator, spokesperson
Decisional : Roles that involve making
choices-entrepreneur, disturbance handler, resource allocator,
negotiator
Manager’s Skills
Technical : Knowledge and proficiency in a specific field
Human : The ability to work well with other people
Conceptual : The ability to think and conceptualize about abstract and complex situations concerning the organization
Top Manager
SQ
EQ IQ
What Makes a Good/Not-so-good Manager?
GOOD MANAGER
Technical
Professional,
Goodwill, willing to share his knowledge
Human
Good coordinator
Gain People’s support
Charming
Friendly
Nice
Conceptual
Ability to think
Logical
Fast mover
Chance/ Risk Taker
NOT-SO-GOOD MANAGER
Lack of Knowledge
Not Organized
Difficult to find, always not in the office
Talking but not working
Highly paid
Not presentable
Careless
Not communicate with Team members
Not care about group members
What is Human Resource Management?
Human Resource (HR) Management
refers to the practices and policies one needs to carry out to deal with thepersonnel aspects of the management job
Human resource management (HRM) is the effective management ofpeople at work
The goal: make workers more satisfied and productive
When an organization is concerned about people, its total philosophy,culture, and orientation reflect it
Every manager must be concerned with people, whether or not thereis a human resources department
Brief History of HRM
The Industrial Revolution (18th
century)
• Changing work conditions, social patterns, and labor created a gap between workers and owners
Frederick W. Taylor
• Father of Scientific Management : Science, Harmony, Cooperation, Maximum output
Industrial psychology (1913)
• Individual differences, the maximum well being of the worker
The Hawthorne studies (1924-1933):
• The effects of illumination on workers and their output. But, it pointed out the importance of social interaction on output and satisfaction
HRM’s Place in Management
The HR department must be a proactive, integral part of management and strategic planning
Ascertain specific organizational needs for the use of its competence
Evaluate the use and satisfaction among other departments
Educate management and employees about the availability and use of HRM services
HRM strategic plans must build on the firm's strengths
Product Subsystem
HR SubsystemProcurement Training
Compensation Appraisal Rewards
Marketing Subsystem
Finance Subsystem
Technical Subsystem
HRM as A Central Subsystem in An Organization
attract and retain talent
train people for challenging roles
develop skills and competencies
promote team spirit
develop loyalty and commitment
increase productivity and profits
improve job satisfaction
enhance standard of living
Good HR Practices help
Importance of HRM
Objectives of HRM
Increasing employees’ job satisfaction and self-actualization
Increasing employees’ Quality of Work life (QWL) : supervisory style,
freedom and autonomy to make decisions on the job, satisfactory
physical surroundings, job safety, satisfactory working hours,
meaningful tasks.
Communicating HRM policies to all employees
HRM contributions to organizational effectiveness
Managing increased urgency and faster cycle times
Maintaining ethical policies and socially responsible behavior
– Planning
– Organizing
– Directing
– Controlling
Operative Functions
HRM
Managerial Functions
Procurement :
Job Analysis
HR planning
Recruitment
Selection
Placement
Induction
Internal mobility
Development:
Training
Executivedevelopment
Career planning
Succession
planning
Human resources development strategies
Performance Appraisal
Motivation and Compensation:
Job design
Work scheduling
Motivation
Job evaluation
Performance and potential appraisal
Compensation administration
Incentivesbenefits andservices
Maintenance:
Health
Safety
Welfare
Social security
Integration:
Grievances
Discipline
Teams and teamwork
Collective bargaining
Participation
Empowerment
Trade unions
Employers’ associations
Industrial relations
Emerging Issues:
Personnel records
Personnel audit
Personnel research
HR accounting
HRIS
Job stress
Mentoring
International HRM
F u n c t i o n s o f H R M
Personnel Mistakes Hire the wrong person for the job
Experience high turnover
Have your people not doing their best
Waste time with useless interviews
Have your company in court because of discriminatory actions
Have your company receive penalties for unsafe practices
Have some employees think their salaries are unfair and inequitable relative to others in the organization
Allow a lack of training to undermine your department’s effectiveness
Commit any unfair labor practices
H R M S t ra t e g y
Compensational (Transactional vs. Intrinsic Reward System)
Transactional Reward System : approach to employee–management relations.
Intrinsic Reward System : approach to trust and recognition.
Involvement-Transformational vs. Inducement-Transactional HRMSystems
Inducement human resource strategy is based on the concept of motivationthrough rewards and punishment.
Investment human resource strategy is built around extensive training anddevelopment.
Involvement human resource strategy is built around creating a very high level ofemployee commitment
HR Metrics Absence Rate
[(Number of days absent in month) ÷ (Average number of employees during mo.) ×(number of workdays)] × 100
Cost per Hire
(Advertising + Agency Fees + Employee Referrals + Travel cost of applicants and staff + Relocation costs + Recruiter pay and benefits) ÷ Number of Hires
Health Care Costs per Employee
Total cost of health care ÷ Total Employees
HR Expense Factor
HR expense ÷ Total operating expense
HR Metrics (cont’d)
Human Capital ROI
Revenue − (Operating Expense − *Compensation cost + Benefit cost+) ÷(Compensation cost + Benefit cost)
Human Capital Value Added
Revenue − (Operating Expense − (*Compensation cost + Benefit Cost+) ÷ Total Number of FTE
Revenue Factor
Revenue ÷ Total Number of FTE
Time to fill
Total days elapsed to fill requisitions ÷ Number hired
HR Metrics (cont’d)
Training Investment Factor
Total training cost ÷ Headcount
Turnover Costs
Cost to terminate + Cost per hire + Vacancy Cost + Learning curve loss
Turnover Rate
[Number of separations during month ÷ Average number of employees during month] ×100
Workers’ Compensation Cost per Employee
Total WC cost for Year ÷ Average number of employees
Measuring HR’s Contribution
The HR Scorecard
Shows the quantitative standards, or “metrics” the firm uses to measure HR activities.
Measures the employee behaviors resulting from these activities.
Measures the strategically relevant organizational outcomes of those employee behaviors.
Benefits of a High Performance Work System (HPWS)
Generate more job applicants
Screen candidates more effectively
Provide more and better training
Link pay more explicitly to performance
Provide a safer work environment
Produce more qualified applicants per position
More employees are hired based on validated selection tests
Provide more hours of training for new employees
Higher percentages of employees receiving regular performance appraisals
HR and Technology
Benefits of technological applications for HR
Intranet-based employee portals through which employees can self-service HR transactions.
The availability of centralized call centers staffed with HR specialists.
Increased efficiency of HR operations.
The development of data warehouses of HR-related information.
The ability to outsource HR activities to specialist service providers.
L e a d e r s h i p
Leadership is a process of social influence, which maximizesthe efforts of others, towards the achievement of a goal(Forbes).
Leadership occurs when one group member modifies themotivation and competencies of others in the group (Bass 1990).
Work motivation is the willingness of an individual to invest energy inproductive activity.
A core outcome of effective leadership is a higher willingness on the partof the employees to invest energy in performing their tasks.
Linkages between Leadership in HRM
New Leadership and Motivation Paradigms :- Transformational, Charismatic, Visionary Leadership- Expressive, Collectivistic, Intrinsic, Long-term Motivation
Organizational Outcomes:- Performance- Employee Development
Implications for Strategic HRM- Recruiting- Performance Management- Training and Development- Compensation
Work Motivation From a Calculative–Rational toward an Emotional–Expressive Motivation to Work
Classic theories assume that supervisors, managers, leaders, and their followers are able tocalculate correctly or learn expected outcomes associated with the exercise of theoreticallyspecified behaviors.
We are motivated to do things because it makes sense to do them from a rational-instrumentalpoint of view, but also because by doing so we can discharge moral obligations or becausethrough such a contribution we can establish and affirm a cherished identity for ourselves.
From an Individualistic-Oriented toward a Collectivistic-Oriented Motivation to Work
People who identify with a group or organization take pride in being part of it and regardmembership as one of their most important social identities. High social identification may beassociated with a collectivistic orientation in the sense that the group member is willing tocontribute to the group even in the lack of personal benefits, places the needs of the group aboveindividual needs, and sacrifices self-interest for the sake of the group
From Extrinsic toward Intrinsic Motivation to Work
Extrinsic needs demand gratification by rewards that are external to the job itself. Extrinsicmotivation derives from needs for pay, praise from superiors and peers, status and advancement,or physically comfortable working conditions. Intrinsic needs are satisfied when the activities thatcomprise the job are themselves a source of gratification. The desire for variety, for meaning andhope, and for challenging one’s intellect in novel ways are examples of intrinsic motivation
Four Core Processes Of Charismatic Leaders By increasing the intrinsic value of effort
that is, increasing followers’ intrinsic motivation by emphasizing the symbolic and expressiveaspects of the effort, the fact that the effort itself reflects important values.
By empowering the followers not only by raising their specific self-efficacyperceptions, but also by raising their generalized sense of self-esteem, self-worth,and collective efficacy.
By increasing the intrinsic value of goal accomplishment
that is, by presenting goals in terms of the value they represent. Doing so makes actionoriented toward the accomplishment of these goals more meaningful to the follower in thesense of being consistent with his or her self-concept.
By increasing followers’ personal or moral commitment.
This kind of commitment is a motivational disposition to continue a relationship, role, orcourse of action and invest effort regardless of the balance of external costs and benefitsand their immediate gratifying properties.